Detailed Business & Financial Plan: MATALO Mobile Manufacturing

This report presents a comprehensive business plan for a mobile manufacturing company named "MATALO Mobile Manufacturing," addressing the increasing demand for mobile technology. The plan includes market research indicating growth potential, a proposed location in Park Royal, London, and identifies key competitors like Wetsle mobiles and Mocksey Mobile. It outlines potential risks such as financial instability, resource mismanagement, and leasing agreement issues. The report details fixed and variable costs, provides a projected profit and loss statement for the first year with a net profit of £156,775, a cash flow projection showing a net cash flow of £96,455, and calculates the break-even point at 21 units with a margin of safety of 73.75%. Key performance indicators (KPIs) such as throughput and cycle time are discussed for performance evaluation. The recommendation emphasizes focusing on customer base development over immediate profit maximization to ensure long-term business sustainability. Desklib provides access to similar solved assignments and study resources for students.

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Table of Contents
INTRODUCTION...........................................................................................................................3
TASK ..............................................................................................................................................3
1. A detailed summary of the business idea including the risks that the business will face in its
working and the potential sources of funding of the business....................................................3
2. Discussion on the key fixed and variable costs of the business:.............................................5
3. Projected profit forecast for the first year...............................................................................6
4. A Projected cash flow for the first year..................................................................................6
5.Calculation of break- even point and Margin of safety............................................................7
6. Discuss the hey performance Indicator to check the progress of the organisation.................7
7. Recommendation which is based on th above report:.............................................................8
CONCLUSION ...............................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Corporate finance refers to the financial funds which are accessible to businesspersons for
running their organisation. These are investments made by businessman in the organisation.
Business plan refers to the structure which is carried by the business organisation so that they can
run their operation for longer period of time (Ameliany, 2021). It is a document which contains
all the details of the plan which is made for the owners of the so that they carry out their
operation efficiently. The business plans usually contain the objectives which have to achieved
by the organisation in the upcoming period. Organisational policies are typically developed over
a period of 3 to 5 years. This report includes the complete business plan through which the start-
up business can get the success in the competitive market. By the help of this they are able to
know that the how the business organisation can run successfully. Further this report also
includes the costs, projected profit and loss statement, and many other requirements which are
necessary for the business.
TASK
1. A detailed summary of the business idea including the risks that the business will face in its
working and the potential sources of funding of the business.
Business Idea- In a present where the people are going toward the technology and by the
help of this the business organisation are growing their business operations continuously and
earn large amount of profit as well. So that’ why this report includes a business plan of the
Mobile manufacturing company. It is because in present time most of the work can be done by
the help of the mobile (Cervigni and Wang, 2018). Due to the mobiles the people are able to earn
money and living their life. They are easy to use and can be can be taken from one place to
another. The people are very used to it and highly depend on them. Because of these reason, the
there is a high demand of mobiles in the market and if any anyone wants to start a new business
they can open a mobile manufacturing start-up with some innovative ideas so that they can give
some competition to their competitors. The organisation for which the business plan is have been
made is named as “MATALO Mobile Manufacturing”.
Conducting Market research: According to the market research the demand of the mobiles
are going to be increase in the upcoming period of time. It may be because of the technological

development in the private sector as well as government sector. In a private sector most of the
work are done by mobiles the students are taking their classes online so that their study cannot be
affected due to any reason. People are doing their work from home for which they require
mobiles so that they connect with their employees or managers and able to do their operation and
duties on the right time (Field, 2018). Artificial intelligence is also an emerging technology
which is also contributing to the trend.
Location: Now the owners of the organisation have to determine the best location for
running of their operations in the business. They have to analyse the area carefully like there is
an availability of the raw material for their manufacturing and also have a good transportation
system so that they can easily distribute their manufacture product all over the market. For this
they can establish their manufacturing industry in Park Royal which is situated in London (UK).
It is because most of the industries are already established their and the transportation system
was also good and effective. At that place they can establish their business in the area of 10 to
20K square feet.
Competitors: The two main competitors of the mobile MATOLA manufacturing company
is Wetsle mobiles company and Mocksey Mobile company. These two are the main competitors
and perform their operations effectively. But the MATOLA manufacturing company have some
innovative and impressive ideas as well.
Customers: The main market where the business will operate in the UK. The UK is one of
the advanced economies with affluent residents and a large number of working class and
students. The goal of the business is to provide these people with better quality mobile to help
them learn and perform everyday tasks.
Why customers prefer these products and services:
Consumers of the business will be more willing to purchase from the business due to its
innovative units, technical progressions and after-sales services. The selling policy of a business
is formulated in such a method that it fulfil the requirements and needs of the consumers and
effects more customers to purchase the product. Mainly focus on shipping products and after-
sales services to customers, such as managing customer complaints and many more (Hanák and
Grežo, 2020).
The Main risks that can be faced by the company while manufacturing and selling PCs are:

Financial risk: The main risk a new manufacturing unit may face is the risk of capital
inflows. Businesses could face a market go-slow if the necessary capital is not provided in the
right amount at the correct time. Monetary risks can also rise if monetary resources are not
optimally utilized in the work. Businesses must remain reasonable with the resources and
financial resources that have been provided to them (Hollcroft, and Lyon, 2021).
Mismanagement of resources: New organisational units have the capacity to use resources less
than optimally. It decreases the profit earning ability of the business and also reduces the
proficiency of resources. This is called resource mismanagement. Manufacturing industries must
ensure that they use resources with maximum efficiency and do not face any waste of those
resources.
Location and leasing agreement: The next risk rises when organisations have to build
industries to produce different mobile equipment used to assemble computers. Since a business
does not want to buy land and machinery for production in the first year of business, the business
will opt for leasing. They may be at risk of lease and agreement-related issues, as well as the
danger of using a leased machine instead of another. To safeguard this, businesses will take the
necessary steps, such as learning how to operate the machine and saving important lease
payment dates to the lessor.
2. Discussion on the key fixed and variable costs of the business:
After creating of detailed business plan the very primary thing to decide is the cost which
can be faced by the business persons. Mobile manufacturing companies needs huge amount
of money for set their business operations it is because most of the monetary funds have
been utilised in purchasing of the new machines, plants and equipment’s. The another part
of monetary funds requires to be spend on the research and development so that the
company can produce the best output from their operations. The two main cost which are
included in every business organisation and faced by each and every entrepreneur are as
follows-
Fixed cost- The fixed are those cost which are fixed in nature and does not change due to
increase or decrease of production in the organisation (Inkon, 2019). If the manufacturing
company wants to earn large number of profit for their business, then they have to reduce
their fixed cost by using them carefully. Some of the basic example of fixed cost are rent,
electricity bill, telephone bills, taxes, insurance, monthly instalments and many more.

Variable cost- The very next cost which is included in every business organisation is the
variable cost. These cost get change and varied due change in the production of the the
organisation. If the production capacity if the organisation gets increase, then the variable
cost also gets increase and vice versa (Jukova and et.al., 2019). Sone of the basic example of
variable cost are mechanics wages, software production cost, R&D expenses, collection and
transportation.
3. Projected profit forecast for the first year
Budgeted Profit and Loss Statement ( for the first year of operation)
Particulars Amount Amount
Sales 400000
Less: Cost of Sales 114680
Gross Profit 285320
Operating Expenses:
Salaries 50000
Rent 11500
Freight & Postage 5000
Stationary 4000
Promotion & Advertisement 8529
Legal 6000
Transport 5960
Vehicles 2956
Insurance 9800
Maintenance 14000
Loan Repayment 7000
Interest on Loan 700
Miscellaneous 3100 128545
Net Profit for the year 156775
4. A Projected cash flow for the first year
Budgeted Cash flow (for year 1)
Particulars Amount
Cash flow from Operating Activities
Cash Sales 400000
Less: Operating Expenses 128545
Salaries 50000
Rent 11500
Freight & Postage 5000

Stationary 4000
Promotion & Advertisement 8529
Legal 6000
Transport 5960
Vehicles 2956
Insurance 9800
Maintenance 14000
Loan Repayment 7000
Interest on Loan 700
Miscellaneous 3100
Net cash from Operations 271455
Cash Flow from Investing Activities
Purchase of Machinery -135000
Net cash from investing activities -135000
Cash Flow from Financing Activities
Capital Investment -40000
Net Cash Flow from Investing Activities -40000
Net Cash flow 96455
5.Calculation of break- even point and Margin of safety.
Breakeven point is considered to that point where the Revenues and Expenditures are same
for the business organisation and the they face the situation no profit no loss. The calculation
Breakeven point are as follows-
Breakeven point = Fixed costs / contribution per unit
= 96485 / 4599.25 = 20.9 or 21 Ut
Contribution margin = price of product – variable cost
= 5000 – ( 32060 / 80 ) = 4599.25
Margin of safety= (Current Sales – Break even sales) / Current Sales *100
= ( 80 – 21) / 80 * 100 = 73.75%
6. Discuss the hey performance Indicator to check the progress of the organisation
Key performance indicators are major tools by the help of which the organisation are able to
evaluate their performance and run the operation of the business organisation smoothly. It also
supports in making of the effective strategy so that organisation can easily achieve their target on
the right time (Koundouri and et.al., 2021). The key performance indicators are revenue for
growth, revenue per client, profit margin, client retention rate and many more. The other KPI
which is used by the organisation are as follows-

 Throughput: This is considered as one of the most crucial indicator which is used in the
manufacturing industry. It supports the the organisation by evaluating the productivity of
the machineries which are using in the industry (Malagapo and Ediza, 2020). It also
measures the performance of fthe staff members as well. It can be calculate by the
formula which are as follows-
Throughput= Quantity of unit produced / Time (it can be daily or hourly)
 Cycle Time: It is the next indicator which is used in the organisation is the cycle time.
Basically it measure the time period in which the organisation have produce a particular
unit and deliver that product to the buyer on the right time as well. It canevakuate the
overall efficiency of the organisation. The formula for measuring the ccyle time is give
below-
Cycle time = process end time – process start time
7. Recommendation which is based on th above report:
By the help of above report it can be recommended that the start business organisation
have to focus on making the customer base not focusing on the earning large profit. If they are
able to make their goodwill in the market then they can easily earn good amount of profit and
able to run their business for longer period as well.
CONCLUSION
After completing the above report it can be analysed or observed that the business is
considered as guideline for the entrepreneur which they have to follow so that they can earn large
amount of profit. Due to the effective business plan the organisation can easily be able to run
their operations for a longer period of time. Some KPI (key performance indicator) are also
included in the above report through which performance of the business organisation can be
evaluate.

REFERENCES
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